Jump to content

The quotable John Mangun on Markets (in PHL)


Recommended Posts

John Mangun on Markets (in PHL)

Untitled-1.png

He has a Blog:

http://MangunOnMarkets.com

And has lived in the PH many years, and is highly experienced with trading in the PH stock market (since 1989)

And also makes posts & commentary at these places:

TWITTER ---------- : https://twitter.com/mangunonmarkets?lang=en

Business Mirror : https://businessmirror.com.ph/author/johnmangun/

Link to comment
Share on other sites

VALUE = "Depends on what people are Willing to Pay" 

This means there is no fixed Fundamental way to value stocks; You need to use Technical Analysis

Example:

As much as the department store would like to sell a t-shirt for Php10,000, the successful owner must lower the price to a level where buyers come in. And that is exactly how the stock market works. Unfortunately, most investors find that unreasonable and hard to believe, thinking that a company’s ‘value’ should - by some magic formula - determine the price. The only magic formula is what buyers are willing to pay.

Metro Bank (MBT) has dominated the news because of the fraud and there is great wailing and gnashing of teeth that the price has gone from Php95.00 to Php86.00. But the price of MBT has always gone from Php95.00 to Php86.00 and lower even when there wasn’t any fraud. MBT could not sustain Php95.00 in May 2013 and fell to Php70.00. In April 2015 Php95.00 failed and Php68.00 was the bottom. It happened again at Php95.00 in April 2016 and the price recovered at Php71.00. Once again in 2017, Php95.00 was the top two weeks ago.

Buyers were not willing to pay more than Php95.00 when the earnings were Php8.02 per share, Php7.15, Php5.70 or Php5.60. MBT did not need a scandal to lose Php18 billion of market value. Buyers took care of that for the past four years. For investors that are looking for the Holy Grail of Fundamental Analysis, Php95.00 was the top when the Price Earnings Ratio was 11, 13, and 16.

Investors would like to believe that there is some sort of ‘real’ or intrinsic value of a company that should be reflected in share price. But even the hard assets of a company are based on market value. Once again, the ‘price’ of everything is determined by how much the buyer is willing to pay.

> from JM's homepage: http://MangunOnMarkets.com

MetroBank : PH:MBT ... All : 5yr : 2yr : 6mo : 10d / Last: 

75.55
Change:
arrow -1.50
Open:
77.05
High:
77.10
Low:
75.25
Volume:
2,393,040
Percent Change:
-1.95%
Yield:
1.27%
P/E Ratio:
14.3223
52 Week Range:
75.25 to 104.9731

xx

Link to comment
Share on other sites

SWEET SPOT for Investing?

"Those who invest in stock markets in the PH "are a small fraternity"

Philippines Stock Index : PH:PSEI ... All : 5yr : 2yr : 6mo : 10d / Last: 

7,551.23
Change:
arrow -51.75
Open:
7,553.80
High:
7,561.44
Low:
7,479.57
Volume:
n/a
Percent Change:
-0.68%
Yield:
n/a
P/E Ratio:
n/a
52 Week Range:
7,457.05 to 9,078.37

CC

There is a strong relationship between stock prices and the economy, but it is not what most people think it is.

Having invested—and advising others—through the local stock market for three decades, I like the Philippines Stock Exchange. Trading is simple and relatively transparent. Stock value is reasonable and there is sufficient liquidity to be able to absorb large amounts of capital. Back in the day, the largest foreign fund devoted to the PSE held $7 million because of low liquidity. Today, there are individual clients that have invested more.

Nevertheless, there has always been the nagging question about the low public participation in the stock market... 

. . . Ignoring the wild swings in the average annual economic growth, ever since 1988, the economy has only been able to squeeze a 4-percent increase. With the population increase rate, 4-percent growth is just survival stage and 5 percent is an extra bag or two of pan de sal.

With that amount of economic growth, there was no money available for stock market investing.

Then, in large measure because of the fiscal policies of the Arroyo administration, the GDP growth rate broke and held the 5-percent area. That is also the time the stock market started taking off. Even with this growth, investor participation stayed low, contradicting the idea that rising stock prices should create rising significant numbers of investors. Since 2009 we have seen historic high after historic high and still stock market investing remained a small fraternity.

. . .  it works this way. Too little economic growth and there is no stock market money available. Too much economic growth and it is more profitable investing in a business because more people have more money to spend. It is a sweet spot that varies from country to country.

Too “little” growth, no money. Too “much” growth, buy a business. Both investing in a business and the stock market come with unique risks and effort. Note, you can open a siomai kiosk for P200,000 and a branch of a Chinese restaurant chain for P10 million. So what is the economic growth sweet spot for the local stock market? That is hard to say. We are way ahead in terms of percentage economic growth than those found in other stock market sweet spots.

Listed companies’ corporate profits are still growing at an amazing rate, as is the economy. What I would like to see is when we have reached the sweet spot in the Philippine personal savings rate, which had been steadily rising since 1998 and has been going down since 2009. When the savings rate firmly flattens out, as it has for the past two years, that may indicate that there is balance in spending, investing, and saving. That may create the sweet spot.

Business Mirror : https://businessmirror.com.ph/author/johnmangun/

Hmm.

Perhaps invest-able funds were pouring into the Hot Property market, instead of stocks

Link to comment
Share on other sites

What to know what it was like to be Jonah and swallowed by a whale?......Ask someone who bought Bitcoin above $7,500............

DfjU_o3WAAApCBE.jpg
 
Link to comment
Share on other sites

  • 2 weeks later...

SEEKING "Too Simple" Answers?

The Philippine tax-reform law goes into effect, and inflation starts going much higher, and of course the primary cause is the Tax Reform for Acceleration and Inclusion (TRAIN) law because of increased excise taxes. That makes sense. But, at the same time, the crude-oil price increases by 14 percent. Rice prices go higher because of government mismanagement of the reserve supply. The Philippine peso depreciates faster than other emerging market currencies.

But no matter the complexity surrounding Philippine inflation, we all know that the TRAIN law is the bad guy.

We also want to see a direct cause-and-effect relation because that is as easy to understand as the clouds move in and the rain falls. But sometimes things just happen at the same time—correlation—even when we cannot identify causation.

The Philippine stock market has been trending with the Morgan Stanley Emerging Markets Index going back to 2011. Philippine inflation has been trending with US inflation back to 2008. The Philippine peso used to track the Morgan Stanley Emerging Market Currency Index until 2015. Now it is going opposite from that index. And it is still hard to understand that a heavier object does not fall faster than a lighter one.

> https://businessmirror.com.ph/the-markets-its-not-that-simple/

Link to comment
Share on other sites

  • 1 year later...

(Here's an update from John Mangun this morning, from a private viber chat):

5350-ish is Key Support / "Get prepared for the largest PSEi rally in history..."

fyi.......All you need to know about the current PSE trading....(weekly)....

RXfLHhz.jpg

fyi2.......All you need to know about future PSE trading....(monthly)....

pCKKGg5.jpg

(On banks):

Get prepared for the largest PSEi rally in history....as with the economy...but it will not start 'tomorrow'........banks will be laggards not leaders...

(My own reaction is):

"Banks will be laggards not leaders..."  That would make sense logically because the financial problems will still be here when the Covid disease fades.  Yet markets are great discounting mechanisms, and (some) banks trading below 50% of Book Value are discounting a lot of troubles.

Link to comment
Share on other sites

  • 2 weeks later...

GREAT CALL - on a PSEI rally, by John Mangun

(John M now suggests):

"If you happen to be on Facebook,

please join https://www.facebook.com/groups/1679992895385600/?ref=bookmarks

... for my constant and probably annoying views on the markets and economy......."

Link to comment
Share on other sites

Create an account or sign in to comment

You need to be a member in order to leave a comment

Create an account

Sign up for a new account in our community. It's easy!

Register a new account

Sign in

Already have an account? Sign in here.

Sign In Now
×
×
  • Create New...